Tuesday, December 4, 2018

According to radio and press reports, a remarkable development has occurred in Scandinavia. Hot water from the springs in Iceland is being shipped to Sweden and used to heat buildings and wash up in Sweden.

The water is drawn off at around boiling point and can be maintained at about 70 degrees Centigrade in insulated ships. What a splendid application of the Marxian labour theory of value. Like virgin land or wild fruit, hot water in Iceland has no exchange-value until human labour is applied to it. It is like the Sahara, valueless until then: when it becomes a commodity, with a price, its value determined by the amount of socially necessary labour-time required to deliver it to the consumers.

For nearly a month in September 1920 over 400,000 Italian metalworkers occupied the factories, particularly in the industrial centres of the north, Turin, Milan and Genoa.

Like many other events in working-class history this has become something of a myth, and generations of left-wingers have been convinced that this was a “revolutionary situation” in which the workers were on the brink of overthrowing capitalism but were “betrayed” by their leaders. An examination of the facts shows that this certainly was not the case.

In August 1920 the Italian metalworkers union (FIOM), faced with a rising cost of living, put in a claim for a wage increase. The employers, badly hit by the slackened demand for iron and steel caused by the end of the war, categorically refused. The union then declared a go-slow. The employers responded with a lock-out and the workers, backed by the union, occupied the factories.

There they stayed for three weeks until the government and others brought pressure to bear on the employers to give in. The workers got their wage increase (plus a vague and useless promise of “union control”) and voted at a conference—later confirmed in a referendum—to resume normal working.

In other words, this was a simple—and successful— trade-union action aimed at getting a wage increase. It was not an attempt to overthrow capitalism. If it had been, then the government would not have maintained the neutrality it did and certainly would not have brought pressure on the employers to settle.

The fact that the government did not intervene or behalf of the employers is to be explained by a conflict of sectional interests within the Italian capitalist class. Before the war, Italy had been ruled by politicians representing the bourgeoisie in the strict sense of the term: the “middle class” (merchants, small traders, etc.) of the towns. They tended to be liberal and anti-clerical in their politics, and were led on the political field by Giovanni Giolitti.

Around the turn of the century, however, in the northern cities of Turin, Milan and Genoa a more modern type of capitalist appeared: the big industrialists, who tended to favour expansionist nationalism This conflict came to a head over the attitude Italy should adopt during the first world war. The traditional bourgeoisie favoured keeping out, and even tended to be pro the Central Powers, Germany and Austro-Hungary. Indeed their bank, the Banca Commerciale Italiana, was partly financed by German capital. Their view did not prevail. Italy entered the war on the British and French side, and Giolitti resigned as prime minister. During the war the northern industrialists made huge profits which they used to try to take over the Banca Commerciale. The attempt failed but it showed that the conflict existed.

It was Giolitti who was again prime minister in September 1920, and it is because the interests of the section of the Italian capitalist class he represented were not the same as those of the northern engineering employers and steel magnates, that the State was neutral during the factory occupation. It was even alleged that the Banca Commerciale helped to finance the metalworkers in this struggle and had threatened to withdraw credit to the employers if they didn’t submit to the union’s conditions.

All this was known at the time. For instance, the article “Socialism and the Fascisti” in the Socialist Standard for April 1923 dealt with the subject and quoted from other sources, the Nation (New York) and the Western Clarion (Vancouver), and these supported the conclusion that the Italian metalworkers won their economic struggle because of a conflict of interests within the Italian capitalist class.

So there was no revolutionary situation. Of course there was such loud and empty talk of “revolution” and the executive of the reformist Italian Socialist Party (PSI) even met to consider whether or not to launch the revolution (as if it were up to them!) but finally decided, under pressure from its trade-union wing (CGL), not to.

This decision was attacked by various leftists of the day as a “sell-out”, but the evidence shows that it was the only sane thing to do. Any attempt by the workers to transform the economic struggle into an insurrection, even if they had wanted to, would have been easily crushed. After all, workers armed mainly with revolvers, muskets and pikes (yes, pikes!) could stand no chance against the forces of the State.

Indeed when the CGL met to consider the possibility of armed insurrection they were told by the Turin delegation that

Fiat-Centro which seems to be one of the best supplied (with arms) has only 5,000 rounds of machine-gun ammunition . . .

(Quoted in The Occupation of the Factories: Italy 1920 by Paolo Spriano, page 86).

and although Antonio Gramsci, later leader of the Italian Communist Party, repeatedly denounced the leaders of the PSI and CGL he admitted privately that

. . . with a working class which mostly saw everything rosy and loved bands and ballads more than sacrifice, a counter-revolution would have inexorably swept us away. (Spriano, page 134.)

Mere working-class discontent or mass action does not constitute a revolutionary situation. The social and political situation will only become revolutionary when the immense majority of the working class, having come to understand and want Socialism, become revolutionary-minded. That was not the case in Italy in 1920 and unfortunately has never yet been the case anywhere else.

Nature in the raw — in fact, on Sunday mornings in Hyde Park. Real-life questions asked at actual meetings by genuine people; nothing added or taken away; nothing invented or simulated.

Question: Am I a capitalist? I run a hairdressing saloon. I am a taxi-driver with my own cab. I run a greengrocer’s shop. I am a jobbing builder. I have an accountant’s office. I am a free-lance photographer, journalist, general practitioner . . . and so on. Short, clear, firm, definite answer: No, you are not!

The long answer is the explanation. Why not?

*

It is a popular fallacy that, since capitalists are obviously rich, all Socialists (who oppose the capitalist system) must be poor. Many people have a hazy notion that all poor people are Socialists and all rich ones anti-Socialists. In other words, they do not know the difference between actual objective conditions and ideas about them.

Nothing is, unfortunately, farther from the truth. The poorer people are, frequently, the more devoted to capitalism. Who has not met the destitute wretch, subsisting by cadging hand-outs, who runs round shrieking nationalistic or religious rubbish (often a psychiatric case through sheer physical deprivation)?

Conversely, nothing is more fallacious than the notion that all rich people are (or were) anti-Socialists. Many rich men and women have been most creditable Socialist thinkers and writers — some outstandingly so. Frederick Engels immediately springs to mind: a successful manager of his father’s cotton mill. In fact, his financial aid made the production of Marx’s Capital possible.

But he was only one of many who contributed, or thought they were contributing, to bringing down capitalism. H. M. Hyndman spent much of his large fortune in publishing Justice and financing the Social Democratic Federation from which the SPGB emerged. Sergei Morosov, the Russian sugar millionaire, financed the Bolsheviks. Ferdinand Lassalle, a founder of the German trades unions, was supported by the fabulously wealthy Countess Hatzfeld. This writer was informed by Max Eastman that Charles Chaplin, when he was running a profitable film venture, regularly supported Eastman’s American radical magazine The Liberator.

It is true that capitalists do not need to work, untrue that no capitalist ever works. They are not all nitwits dedicated to gambling, boozing, etc. The late Lord Rothschild was a biologist of world repute, an acknowledged authority on fleas (though as in other subjects, especially science, this sort of research is not as altruistic as it may seem: nobody wants lousy workers — not only capitalists, but other workers). Other wealthy men and women have spent fortunes on the arts and actually participated in archaeology, exploration and science.

What makes a person a capitalist is not what he thinks, but what he has: his bank balance, not his mental balance. This is the crux of the question. A capitalist is a possessor of capital.

And what is capital? It is wealth invested to produce profit. That is why the Great Train Robbers immediately after their successful “job” were not capitalists. Their problem was to “get rid of it”, i.e. invest it, integrate it with social production. The trinkets and diamonds in the safe-deposits of the French banks robbed recentlyare wealth, but not capital; they play nopart in production, makeno profit. They are “hoards”.

This brings us to the mathematics. “Mr. Speaker, am I a capitalist?” Yes — if you have at least £250,000 in readily realizable assets (so-called “liquid funds”)in a bank, company, property or bonds. £250,000 at 10 per cent. (you’ll be lucky!) would perhaps realize £25,000 annually. £25,000 should net a little under £500 a week. Tax deduction (assuming no Capital Gains) at least £200 weekly. Net balance: £300 weekly (approx.).

Not too much, really — because, unless you choose to become a hermit living on raw onions in a shed (as one or two capitalists have done) you’ve got to be like the other capitalists. Not much for the wife’s mink. You could hardly park the Rolls or Merc outside the high-rise blocks in Brixton or Paddington : the neighbours would be ringing the police, and the kids smashing it up. Even the gardener or chauffeur would want about £50 a week.

For a real 1980 capitalist, a quarter of a million is peanuts. As Paul Getty remarked acidly, “How can you call yourself rich if you know how much you’ve got?” Another tycoon, asked by an ingenuous young admirer how much his fabulous yacht cost, said: “Listen, son — when you start counting the cost, you don’t buy one of these boats.”

Howard Hughes paid £500 a night (without Security, which was extra) for his modest pad at “The Inn on the Park”. Statisticians have calculated that if a common soldier landing with William the Conqueror had worked incessantly and frugally from then to now he would still not own as much as Sir John Ellerman in 1976.

No, you are not a capitalist, and you are even less likely to become one. But once you realize what the capitalist system is and how it works — you can become a Socialist.

The 50 Years Ago column from the December 1977 issue of the Socialist Standard

When we urge the supreme importance of the working class capturing Parliament, with the administrative departments and local councils which it controls, we are often met with the argument that the Fascists came to power in defiance of the then constitutionally elected Italian government.

★ ★ ★

But as we have pointed out before, the Fascist seizure of power took place not in defiance of, but with the approval and active assistance of, the democratically elected Italian government. But for that active assistance Mussolini and his followers would have been helpless. Then, as before and since, the possession of the State machinery proved to be the deciding factor. Our view has received interesting confirmation from three sources—the Italian Communist, Bordiga; Professor Salvemini, a Liberal; and Modigliani, of the Italian Socialist Party.

Bordiga says (Labour Magazine, February & March 1923):- ‘After the Nitti, Giolitti, and Bonomi governments, we had the Facta Cabinet. This government was intended to cover up the complete liberty of action of Fascism in its expansion over the whole country. During the strike in August 1922, several conflicts took place between the workers and the Fascisti, who were openly aided by the government.

★ ★ ★

Wherever Fascism had been beaten back by the workers, the power of the State intervened; workers who resisted were shot down; workers who were guilty of nothing but self-defence were arrested and sentenced; while the magistrates systematically acquitted the Fascisti, who were generally known to have committed innumerable crimes.

Classes are defined by their respective connections to the productive forces within a certain type of production relation, and arise as soon as it is no longer necessary for everyone to work in order to sustain society. A social division of labour has been transformed into a relation of oppression and exploitation.

Thus, history may be roughly divided into periods characterised by a predominant mode of production and, based upon it, a class structure consisting of a ruling and oppressed class. The struggle between these two classes determines the social relations between people. Further, the ruling class, which owes its position to the ownership and control of the means of production, controls in a subtler way the whole moral and intellectual life of the people. In the period of its ascendance each class is “progressive”: its economic interests are identical with technical progress and its ideas and institutions have a liberating influence. On becoming the ruling class, however, it assumes a reactionary role, resisting attempts to change social and economic organisation. The resulting tensions and conflicts lead to revolution.

This materialist concept of historical change is not to be interpreted mechanistically, however. It is mistaken to imply that only technical and economic factors are important and that the whole social, political and intellectual realm is of secondary significance. Socialist theory is a tool for political action and the materialist approach serves as a guide to the study of, and not as an excuse for ignoring, historical events.

Why do we stress the importance of the organisation of production as a determinant of social class, rather than sociological favourites such as status difference? The reason is simple. Since it is labour that makes history, an understanding of the conditions of production, of man’s struggle to provide for his subsistence, is the key to the understanding of historical change. The satisfaction of basic needs makes work a fundamental facet of human life. The more new needs that are created, the more important it is that the instruments of production are improved and that individuals co-operate socially to this end. This implies the division of labour over and above the techniques of production employed.

The experience gained in the effort of making a living foster common beliefs and actions among members of a social class. Conflict over economic reward, communication of ideas between members of a class, and common suffering (not only material) experienced in exploitation help overcome differences and conflicts between individuals and groups within a class and encourage the growth of class conscious political organisations. Under capitalism this process, arising alongside inherent and growing social contradictions, has formidable obstacles in its way: individual competition for jobs, and between employed and unemployed and, perhaps most important, habitual assumptions about the existence and automatic functioning of capital. Social relations are taken for granted and codified in laws and custom. Transactions between workers and capitalists have the appearance of freedom on both sides, of “fair” exchange. This masking of reality, of things appearing what they are not, is a basic characteristic of class society. In reality, “the wage-labourer is bound to his owner by invisible threads. The appearance of independence is maintained by a constant change in the person of the individual employer, and by the legal fiction of a contract” (Capital, 1, xiii p. 719, Penguin). He is regarded and treated as an adjunct to the productive forces.

If a worker acquires the consciousness of an exploited individual, this is of little significance unless it is part of a collective, antagonistic movement extending outside the work situation. As an individual he may resist exploitation and hence develop “trade union consciousness”, but to the point that he challenges the capitalists’ legal right to expropriate the product of his labour at all, involves the emergence of class consciousness. In that they have common economic interests, wage and salary earners are “already a class as against capital, but not yet for itself. In the struggle . . . this class becomes united and constitutes itself as a class for itself . . . [And this] struggle of class against class is a political struggle” (Poverty of Philosophy, p. 150, Moscow edn.).

Karl Marx did not discover the existence of classes or their historic struggle. The modern notion of class —as distinct from rank—arose in the course of the French Revolution, from an awareness that the removal of legal privileges did not in itself result in social equality. The sharpening of class antagonism by the Industrial Revolution brought to the fore an awareness of the dynamic element of class. Marx’s class concept was a fusion of historical and economic elements, of which surplus value was central. In Capital he summarised it thus: “the specific form in which unpaid labour is pumped out of the immediate producers determines the relation of domination and subjection”, which in turn constitutes “the final secret, the hidden basis of the whole construction of society, including the political patterns of sovereignty and dependence, in short of a given form of government” (Vol. 3, p. 772, Moscow edn.). The class that controls the means of production will wield effective political power.

Capitalism has largely absorbed the remnants of classes from the previous mode of production (land- owners and peasants) and polarised society into two main classes. The enormous increase in wealth production has brought about the integration of the ownership of land and capital. (Marx loosely referred to two other groups as classes: the intelligentsia — “those who make the perfecting of the illusion of the class about itself their chief sources of livelihood”— and the lumpenproletariat—“a recruiting ground for thieves and criminals”. There is no evidence to support the theory that these two groups merged in the course of struggle to give us today’s professional politicians.) Marx’s views on the increasing poverty of the working class follow logically from his class analysis of society. Contrary to common belief, he never claimed that workers would become increasingly poor in absolute terms and could not improve their living standards. His case was that the gap between worker and capitalist would widen and that any increase in workers’ standards would always go hand in hand with increased wealth for the capitalists. He makes this clear in Wage Labour and Capital:

A house may be large or small; as long as the surrounding houses are equally small it satisfies all social demands for a dwelling. But let a palace arise beside a little house, and it shrinks from a little house to a hut. The little house shows now that its owner has only very slight or no demands to make; and however high it may shoot up in the course of civilisation, if the neighbouring palace grows to an equal or even greater extent, the occupant of the relatively small house will feel more and more uncomfortable, dissatisfied and cramped within its four walls.

(p. 32 Moscow edn.)

The class struggle is not a moral assertion about the inhumanity of the capitalist system. Against the background of the failure of humanist ideals and reform movements of all kinds, the last two classes in history confront each other with their needs and interests in direct opposition. The days of both are numbered.

The 50 Years Ago column from the December 1979 issue of the Socialist Standard

Then he goes on to tell us that Marxians and Marx “approve a gold standard” . . . He refrains from giving any specific quotation . . . to justify his assertion. He does not quote such a passage because no such passage exists. The statement is completely false. Marx did not, and socialists do not approve the gold standard or any other currency system. Socialism means a system of society in which goods are produced for the use of the members of society, not for the profit of a privileged class. There will, under socialism, be no buying and selling, and therefore no need for any currency system, on a gold basis, or of any other kind. That is socialism and that is what we work for.

(From “Socialism and the Gold Standard” reply to a correspondent, Socialist Standard December 1929)

Christmas: the anniversary of the birth of a legendary con-man who tyrannised the ignorant believers of the ancient Middle East by threatening that “He that believeth not shall be damned”. (Mark xvi, 16.) And the ignorant believers of our time, the alleged Age of Science, flock to the churches to prove their stupidity and moral purity. Priests bless the working class and tell us that we are saved. Nobody knows more about saving than the wage slaves, for they are the ones who are forced to store away and put aside their negligible share of wealth so that on at least a few days of the year they and their families can forget that they are workers.

On Christmas day the working class may eat, drink, watch television and give each other presents almost as if the world was theirs. Men, normally appendages to commodity-producing machines, are allowed to spend time with their families. Laughter is permitted without the guilt of ‘timewasting’. Song and dance and games are there to be enjoyed. Is it only the most naive child who dares to ask why it can’t be Christmas every day?

No, there are others. The capitalist investors in the large department stores, selling rubbish to a class of bargain-consumers, would be happy to see profits reach the December peak every month. The advertising companies, there to persuade us to need what only financial sacrifice can buy, would not mind a year-long dose of Christmas money-wasting for the working class. The TV companies, with their annual tasteless mixture of Morecambe and Wise and Christ and Queen would readily churn out their glittering propaganda every day of the year. The Bishops and the other philosophical phonies rejoice in this yearly suspension of disbelief. Christmas, for the few who exploit and commercialise the lives of the many, is a worthwhile investment.

Of course, for the small minority of men and women who own and control the means of wealth production and distribution it might as well be Christmas every day. They are the class who have no need to work. They eat the best food, wear the best clothes, drive the best cars and live in the best houses. They do so because the working class give them a present every day and week and month of the year. We give them surplus value: more than the amount of values paid to us in the form of wages and salaries. The exploitation of the wealth producers is the source of the profit of the parasite class. The workers produce; the parasites grow rich. For capitalists, every day can be Christmas.

But it is not quite the same. Because on most days of the year their social inferiors are not to be found living it up at home. If the working class did that—if we were to become permanently idle like the socially superior class— there would be no one to run the factories, go down the mines, drive the buses and trains, farm the land and work in the schools and hospitals. Without work production would stop. Yet without working the owners of the means of production live in luxury. What a useful present we give them. And in return they give us a few days off for Christmas.

What a miserable time Christmas is for those too poor to enjoy it. The children whose parents’ poverty denies them access to the gifts seen on television. The homeless, the starving, those employed to fight wars. In a world which can potentially provide for three times the food needs of the present population, while millions die of malnutrition, recipes for plum pudding and mince pies are a sick joke. When bombs kill workers in a struggle for a market that another capitalist gang wants to add to its collection it is an insult to tell us that Jesus Christ died for our sins.

The image of Christ, who in all probability never existed, represents the twin idiocies of superstition and morality. Both serve to enslave the working class; superstition because it leads people to believe in the scientifically unprovable and morality because it reinforces the values of the profit system in the name of Human Nature. Pious and simple souls tell us that we ought to return to celebrating Christmas as a Christian festival. We remind them that to celebrate their Christianity is to proclaim the philosophy of the socially and scientifically ignorant.

If Father Christmas was a socialist he would drop Socialist Standards down the chimneys of the exploited instead of record tokens and toy guns. He would tell people that they could be free every day to enjoy themselves and co-operate and show goodwill. In a world without the obstacles of class division and production for profit people will no longer be forced to look forward to a single happy and satisfying day. On December 26 there will be another three hundred and sixty-four days to Christmas. Or it could be socialism every day.

The child who asks “Why can’t it be Christmas every day?” deserves an answer. For the leisured class, it might as well be; but for those who worry and scrape all year, the festive season means a lot. It is a time to indulge the traditional fantasy of harmony between the opposed interests of employers and workers, robber and robbed. A time of “peace and good will”, as people die in wars in the Middle East, Ireland, El Salvador, Afghanistan and Africa, in the quarrels of rival rulers. Nerve gas and plague are developed as weapons. One person dies of starvation each second, while food is destroyed to maintain profit levels . . . and yet people’s minds are preoccupied with praising the glory of a “god” invented in the infancy of the human race.

Religion, which is not an inevitable feature of human society, generally rests on acceptance of unproductive and unprovable ideas: the existence of a supernatural power beyond our comprehension, of a supreme being with total control and of life after death, to compensate for the misery of life before death. The fantasies of an after-life have always reflected the favourite pastimes of the particular group who invent it. For example, the Red Indians had a “happy hunting ground”, and the ancient Greeks dreamed of Olympus, where athletic heroes could fight out their contests. This is because religion arose from the problems faced by human society in its attempts to achieve order and to control nature. We made god in our own image. The first gods were images of dead chiefs and warriors; the gods of the early Chinese were yellow-skinned and slant-eyed; while those of the negroes were dark-skinned.

Religion in general, and Christianity in particular, preaches humility, submission, self-contempt and obedience. It puts forward the most conservative view of society. The bible openly advocates slavery and offers compensation to the poor only after they are dead. On authority and freedom, it is explicit:

Let every soul be subject unto the higher powers. For there is no power but of God: the powers that be are ordained of God. Whosoever therefore resisteth the power, resisteth the ordinance of God: and they that resist shall receive to themselves damnation (Romans 13, 1-2).

But it is on the subject of poverty that christianity really comes into its own. In Pope Leo XIII’s encyclical letters on the Conditions of the Working Classes, for example, there is a section on “The Poor Must Accept Their Lot”:

As for those who possess not the gifts of fortune, they are taught by the Church that in God’s sight poverty is no disgrace, and that there is nothing to be ashamed of in seeking one’s bread by labour.

Christianity will often be prepared to “speak up on behalf of the poor”; but when it comes to ending the difference between the class who produce wealth and their employers who possess it, the church is among the first to defend the status quo. Religion is based on fixed authority and stands in opposition to scientific knowledge and critical investigation. Above all, it opposes the mental revolution which is the necessary first step of the social revolution we so urgently need.

As the number of days until Christmas rapidly approaches three hundred and sixty-four, it is fitting that Karl Marx should have the last word:

Religion is the sign of the oppressed creature, the sentiment of a heartless world, and the soul of soulless conditions . . . The abolition of religion, as the illusory happiness of men, is a demand for their real happiness. The call to abandon their illusions about their condition is a call to abandon a condition which requires illusions.

The debate between the Socialist Party of Great Britain and Martin Webster of the National Front, which was to have taken place at the Cambridge Union on 12 October (see OctoberSocialist Standard) was cancelled on the advice of the Cambridge police as a result of threats from the Socialist Workers’ Party and the British Movement. A letter from the Cambridge Community Relations Council warned us that if we participated in the debate we would "discredit the Socialist Party of Great Britain and will only do damage to both your cause and the cause of positive race relations’’.

In the course of the same letter, Judith Kibblewhite stated that "we believe that fascist arguments and propaganda must be countered at every opportunity”. If this is so, why does she urge the SPGB not to counter such arguments in open, democratic debate? Is exposing the stupidity of racist arguments damaging to “positive race relations”? If the Cambridge CRC is worried about damage being done to the socialist cause why were they in the forefront of a campaign to deny the SPGB the opportunity to state our ease in public?

The truth of the matter is that there are certain organisations, including the Cambridge CRC, the SWP and the British Movement, which believe in winning arguments by force or censorship. The National Front, thanks to the undemocratic actions of their opponents, is now able to pose as a defender of democracy. The ultimate result is that the NF has been saved from public exposure by socialist speakers and the SPGB has been denied a useful propaganda activity. Needless to say, we are waiting for the next opportunity to accept an invitation to debate with the defenders of capitalism.

CND Demonstration

The Party was well represented at the CND demonstration in Hyde Park on Saturday, 24 October. Two thousand leaflets were distributed, putting the case against the reformist opposition to war. Copies of the leaflet are available from Head Office. Several dozen copies of the October Socialist Standard were sold.

Boxing Day Propaganda

Readers likely to be bored out of their minds with the Christmas ritual may wish to attend the public meeting which is being organised in Hyde Park on Boxing Day from 11 am until 4 pm. What we have to say will be better than the Queen’s Speech and rather less dull than Gone With The Wind.

Most members of the working class find it difficult to imagine a society without wage-earners. Born into a world where the majority of people depend on wages to survive, they imagine that there is something inevitable about this arrangement and perhaps forget that it was not always so. In primitive societies there were no wage-earners; in slave-owning and feudal societies, very few. The preponderance of wage-workers in modern societies is the result of the development of capitalism as a mode of wealth production.

Wages are the price paid by the capitalist employer for the physical and mental energies of the worker for an agreed period of time – typically in this country for a forty-hour week – although the period of time may be much greater, especially among what are known as “salaried employees” or the “executive class” who are nonetheless wage workers like the rest. However, during whatever period of time is customary for the type of work, the employee must accept that any wealth produced, whether in the form of commodities or services, belongs to the employer to dispose of at whatever price the market will bear.

Profit is not something added on by the employer when the product is marketed. A moment’s thought will show that this cannot be so. If it were, then we would need to ask ourselves why profit margins vary so much, why occasionally some employers make a loss, and why they are so concerned about wage levels when all they would need do is add to the costs of production, including wages, a percentage profit

At a time when there is a shrinking and therefore highly competitive market, employers are under greater pressure to reduce wages in order to survive. This downward pressure on wages takes many forms, some of which may not be immediately evident.

In a period of high unemployment employers may present workers with the alternative of a direct cut in wages or redundancy as has happened recently on Sealink Ferries.

Employers may search the labour market for workers who will accept the lowest pay, compatible with efficient work, for example by employing women instead of men, younger workers with smaller financial commitments or immigrant workers accustomed to a lower standard of living. They may even transfer their activities abroad to take advantage of a cheaper labour market.

The introduction of machinery, or the updating of existing machinery, may reduce a company’s wage bill by making it possible to employ unskilled instead of skilled workers or simply by reducing the numbers of workers required for a given volume of production.

By changing the organisation of the productive process, for example by division of labour, the actual numbers employed may be reduced or production may be increased without adding to the labour force. The stress put on “increased productivity” should sound a clear note of warning for the working class in spite of the fact that many so-called representatives of the workers go along with the idea. Just as the capitalist class consider their interests as a class, so should the working class view their collective interests.

In the road transport industry the increase in the size of lorries is designed to reduce the number of drivers and therefore the total wage bill. Thus we see on the roads today lorries of a capacity many times those used a decade ago – yet still under the control of one driver. A similar development is seen in the size of aircraft, which results in a more intensive use of airfields.

In the retail trade self-service has been introduced wherever practical. For some products, for example groceries, people may welcome the saving in time. Some may deplore the lack of personal service. These considerations do not however enter into the calculations of the capitalist, who will weigh in the balance the cost of installing the self-service system against the saving in wages which may result. This is often a two-fold saving: in numbers of staff relative to the volume of sales and the level of wages required to operate the system.

To maximise profits wages should ideally be just adequate to maintain the worker’s efficiency and to rear children as replacements. When during World War II reformers were advocating a system of family allowances – in this case payment to those with large families – Sir William Beveridge put the matter quite clearly from the employers’ point of view. In a letter to The Times (12 January 1940) he wrote:

We cannot in this war afford luxuries of any kind, and it is a luxury to provide people with incomes for non-existent children.

A system of family allowances is not the only way in which wages can be made to fit more closely the minimum needs of the working class. Any form of government subsidy must be viewed with suspicion from this point of view. We may take for example the recent debate on the need to subsidise public transport. Its advocates present such measures as a benefit for those workers who travel to work each day by train or bus. In fact it is only a benefit to employers who would otherwise have to include in the wages of all their employees enough to pay the “economic fare” – whether or not they all make use of public transport. To paraphrase Sir William Beveridge’s comment: “We cannot afford the luxury of providing people with incomes for non-existent journeys”.

We leave to last the most general assault on wages, an assault which has occurred in all those countries which have departed from a currency linked to gold – in other words, those countries using inconvertible paper money. Where paper money is issued, unrelated to the wealth production of a country, then the purchasing power of that money falls. The massive increase in prices which we have seen in this country over the last ten years has been almost entirely due to the excessive printing of paper money; that is, currency inflation which successive governments have employed to meet part of their public spending requirement. In a speech in the House of Commons Sir Keith Joseph reminded MPs that

The Government had to obtain the money it spends from taxing, borrowing or printing. There is no other source (The Times 27 January 1981).

She (Margaret Thatcher) should emphasise that, if we are not to have higher taxes or higher borrowing leading to higher interest rates, then calls for higher public expenditure can only mean printing money (The Times 28 October 1981).

The Prime Minister heartily agreed. Nevertheless, the over-issue of currency has continued, though much abated, so that the resulting price inflation still runs at around 8 per cent.

If any worker imagines that the present assault on wages is temporary, he should be warned by a statement made recently by Sir Terence Beckett, Director General of the Confederation of British Industries. The Times (29 July 1982) reported him as saying:

In practice, employers should try in the forthcoming pay round to keep increases in labour costs down to a ‘remarkable 3 per cent last year’, as far below those of their overseas competitors as possible. But pay restraint should not be exercised for the next 12 months or the next decade. It is for ever.

Any government, whether it be Conservative, Labour, Liberal, Social Democrat or “Communist”, is forced to assist in the downward pressure on wages in face of the fierce competition for the sale of commodities and services at a profit.

US politics has reached the stage where the plutocrats of either party have ceased to pretend to any real principled difference but are instead using allegations of criminality and corruption against each other. This is a sound tactic, since there is no clean way to the top of US politics: it takes money, and the smiling acceptance of the people with money to get to the top. The vast scale of any campaign means there will be reporting, recording and donating errors somewhere.

The New York Times (2 October) has joined in this game of mud flinging, with a deep investigation into Donald Trump’s business and tax affairs. Journalists David Barstow, Susanne Craig and Russ Buettner have dug through thousands of public documents relating to Donald Trump’s father’s business empire, to see how they relate to the President’s current wealth.

Donald Trump has come to power as a representative of the naked rule of wealth: he has filled his cabinet and other appointees with the wealthy and the sons and daughters of the privately wealthy. He does so without the usual hypocrisy of appointing those who have served their time in lucrative public service.

Much of the New York Times’s revelations were hardly surprising. It was widely known that Donald Trump’s father, Fred, was a wealthy landowner who possessed many rented properties in New York. It was widely known that his father was a shrewd and ruthless business operator. The reporters note that Fred Trump managed to receive large amounts of Federal loans as part of New Deal home building schemes. The article suggests he received as much as $26 million of cheap loans from the government. He also knew how to work the Democrat Party machine that controls much of politics in New York state and city, and backed up his business empire with a team of legal and financial professionals to protect his interests.

What the report showed, though, in detail, was just what a typical capitalist Donald Trump really is.

Inherited

Much of the report concentrated on debunking Trump’s claim that he started his business with a $1 million loan from his father, that he repaid (with interest). It is interesting to see that people could take this with any sort of face value of making him a ‘self-made’ billionaire. $1 million in the 1970s was a very considerable sum (and for most people still is). What the New York Times revealed was that Fred Trump actually siphoned millions of dollars into his son’s businesses, including refloating them when they ran into financial difficulty. One incident the reporters relay involves Trump Snr. sending a flunky to one of his son’s casinos to buy $3.5 million of gambling chips, and then placing no bets.

Fred Trump actually started his financial management early, apparently appointing Donald a director of one of his firms when he was still a toddler, accruing a salary worth hundreds of thousands of dollars. This continued throughout Fred’s life, as Donald, and the other Trump children, were appointed directors of firms which then received transfers from other parts of the Trump empire. The usual approach was to transfer properties with a low estimate value, before selling them off at a huge market value many times greater. The New York Times identified 295 such income streams. They estimated a total transfer of $413 million (in current prices) from father to son, much of it bypassing gift and inheritance tax rules.

A particularly naked scheme saw the establishment of a shell firm, called ‘All County Building and Supply Maintenance’ through which Fred Trump channelled the procurement for his managed apartment. The shell company inflated the prices of the goods bought, effectively allowing Fred Trump to channel money to his children (the nominal owners of the firm) in the form of corporate profits. A side benefit was that under New York’s rent regulations, this could be passed off as a legitimate cost of business increase, which allowed Fred Trump to raise his rents.

These were just the tangible benefits. Fred Trump had friendly bankers, and a reputation which could only mean that doors would open for his son that would be closed to almost anyone else. Donald Trump’s business was underwritten by his father, so people could lend and invest in his ventures with an understanding they would be very unlikely to lose their shirts. In the end, it was all backed up by the tangible assets of owning large chunks of land in central New York.

Typical

In this sense, then, Donald Trump is a very typical capitalist. He begins with a stockpile of accumulated wealth, his primary accumulation, which is usually received through inheritance, windfall, or through expropriation. The capitalists tend to be shy about this primary accumulation, since it belies their ideological claim that their wealth stems from their hard work, business acumen or risk-taking. In Donald Trump’s case, this primary accumulation is both his inheritance and his father’s capacity for raking in Federal subsidies.

This also shows that far from the fearless capitalist making his money away from, or despite, the activity of the state, in fact the process of creating capital is intimately tied up with state power and control. The Trump Empire depended on being able to get favourable consent from the city authorities. The army of lawyers were needed to use state mechanisms to enforce and protect the interests of the firm. Any regulation, such as rent controls, just became another lever to be manipulated in the single minded pursuit of gain for the family. Donald Trump’s presence in the White House is just a continuation of the practice to the world stage.

Any very wealthy person will engage in tax management and structure their inheritance effectively. What the New York Times’s investigation into the Trump empire shows, much like the Panama papers, is how trying to regulate the financial affairs of the wealthy is like trying to strangle porridge. The wealth of capitalists does not rest in mere things, but in the claim to things, and the power to exercise that claim. Such claims are entirely ethereal, existing only in the material practices of the lawyers and law enforcers who respond to them.

Donald Trump’s team have responded to the report by pointing out that all their activities were carried out under the advice of reputable tax managers and lawyers, and were all within the regulations at the time. They do not maintain that those practices were right, or good or noble, only that they were legal. As ever, it is one law for the poor, and as many laws for the rich as they want to buy.

Barstow, Craig and Buettner estimate that had Donald Trump simply invested the money he made from his father, he would have nearly £2 billion in wealth. It’s clear that Donald Trump is not a self-made man, his wealth comes to him not because he is ‘a very stable genius’, but because he has a powerful claim on other people’s work. As a bog standard capitalist, it is plain that he is not necessary to producing or adding to the wealth of the world. Though perhaps, by forcing his opponents to reveal this truth about capital, he may have done one worthwhile thing with his life.

The Material World Column from the December 2018 issue of the Socialist Standard

Far-right parties are mushrooming in popularity across the world elected on campaigns that disdain democracy and glorify authoritarianism. Bolsonaro attracted support from voters overlooking his fascistic tendencies. Recent surveys have found that 55 percent of Brazilians wouldn’t mind a non-democratic form of government if it ‘solved’ problems. Brazilians do have legitimate complaints about poor services. 83 percent of Brazilians believe that more than half of all politicians are corrupt, and they can’t be far wrong. More than half of Brazilian senators and one third of the members of Brazil’s lower chamber of Congress face criminal accusations.

The deep economic and social inequalities have made many Brazilians desperate enough that they are now willing to gamble on a maverick politician who is perceived as a man of action who will shake things up. Bolsonaro has proven wildly popular with some of the country’s most famous footballers: Ronaldinho, Rivaldo, Cafu, Kaka, Lucas Moura, all of whom have spoken in favour of him, even Neymar praised Bolsonaro. And while the endorsement of a few footballers may not have been the decisive factor in Bolsonaro’s victory, it nonetheless provided free publicity.

Bolsonaro, a far-right former army captain, openly defends Brazil’s 1964-1985 military dictatorship which saw at least 30,000 people killed, and has recently stated ‘If Congress grants permission, I would put armed forces in the streets.’ Bolsonaro proudly announced at a rally ‘We are going to gun down all these Workers Party supporters,’ using a tripod to mimic shooting a rifle. He has pledged to ‘purge’ Brazil of his left-wing foes.

Alfredo Saad-Filho, the leftwing professor, explained ‘Bolsonaro thrives on the notion that politicians are all corrupt, are all incompetent, and therefore the military is the solution. What is going to happen, likely, under a Bolsonaro administration is the dragging of the army into politics, into corrupt scandals, and its transformation into another gang’ (LINK.).

The man expected to head the culture ministry, Alessio Ribeiro Souto, is a former general and has said school history books should call the 1964-85 junta a movement to fight communism rather than a dictatorship. He wants creationism to be taught in schools.

The minister of transport may well be Oswaldo Ferreira, yet another retired general, who can be expected to authorise the building of roads through the Amazon forest, which will cause severe damage to indigenous communities and the country’s exceptional biodiversity.

Bolsonaro’s choice for finance minister is Paulo Guedes whose free-market economic agenda includes privatisation of almost all state-run companies, ending the protection of the Amazon rainforest and opening it up to commercial development and further cutting government spending on social services.

Bolsonaro has the backing of agri-business and mining companies, who are looking forward to the prospect of the Amazon rainforest losing its protection. He has promised to ease ‘excessive’ oversight by the country’s environmental watchdog and join up the Ministry of the Environment with the Ministry of Agriculture and Livestock. Business interests anticipate reductions in fines for those encroaching on the world’s biggest tropical forest, reducing its power to counteract global warming.

‘Everything is at risk,’ said Carlos Nobre, a climatologist at the Institute of Advanced Studies of the University of Sao Paulo.

‘We may face an unprecedented environmental disaster in the next four years,’ said Brazilian researcher Paulo Artaxo, a member of the Intergovernmental Panel on Climate Change (IPCC). ‘The main concern is the Amazon. According to Bolsonaro’s statements we can conclude that illegal settlements and deforestation will accelerate.’

Bolsonaro’s election victory could lead to indigenous people losing land rights. Bolsonaro said during his campaign that ‘not one centimetre of land will be demarcated for indigenous reserves or quilombolas [slave descendants]’, and that indigenous lands could be opened to economic exploitation, including agribusiness and mining. Bolsonaro called quilombola residents ‘lazy’ and said they were ‘not fit for procreation’.

Brazilian voters were desperate for change and have mirrored an anti-establishment trend that has swept around the world, where political ‘saviours’ have been voted into office. The distrust meant people believed in quick easy answers to their problems and the common tactic is to propagate nostalgia for an idealised past that these politicians miraculously promise to bring back. The strategy of these populists is to promote fear, anger, and hatred, scapegoating certain communities for the cause of all the ills afflicting society.

Enough voters fell for this, but right-wing politicians betray their election promises as much as left-wing ones, fortunately.

The Cooking the Books column from the December 2018 issue of the Socialist Standard

To prepare his article in the FTWeekend Magazine (20/21 October) on the German Social Democratic Party, Tobias Buck visited the one-time tavern in the town of Gotha where in May 1875 two working-class organisations united to form the Socialist Workers Party of Germany, which later became the SPD. He looked at the programme adopted at the meeting that was on display there, and commented:

In economic terms, it is unashamedly socialist, urging the end of wage labour and “the transfer of all productive goods to the commonweal of society.” In political terms, however, it reads like a blueprint for the modern, progressive welfare state that Germany is today.

This is a shrewd observation as it brings out the division of the programme into what was later called the ‘maximum programme’ (common ownership of the means of production, abolition of the wages system) and the ‘minimum programme’ (social and political reforms to be achieved under capitalism). This division was inherited by all Social Democratic parties modelled on the SPD. It was to be their undoing as it attracted support for the minimum programme rather than for socialism and made them in effect democratic social reform parties.

Marx wasn’t happy with the programme and wrote a paragraph by paragraph criticism of it. These were private notes and were not made public till 1891 as the Critique of the Gotha Programme. Some of his criticisms, though correct, seem a little petty. For instance, he takes the text to task for saying that ‘labour is the source of all wealth’ (whereas ‘nature … is just as much the source as labour’) and for saying that in present-day society ‘the instruments of labour are the monopoly of the capitalist class’ (whereas they are the monopoly of ‘the landowners … and the capitalists).

Other criticisms were more substantial such as his objections to a ‘free state’ as an aim and to the demand for each individual worker to receive the ‘undiminished’ product of their labour.

With regard to the ‘free state’, he explained that the existing state had its roots in capitalist society and could not be made ‘free’ but would die off when capitalism was ended, and said that the question that should have been asked in regard to ‘communist society’ was ‘what social functions will remain in existence there that are analogous to present state functions?’

In his criticism of the demand for the ‘undiminished proceeds of labour’, he pointed out that even ‘within the co-operative society based on common ownership of the means of production’ there would have to be provision for those too young, too old or unable to work and that this meant that the actual producers could not receive the full product of their labour.

In these answers he also dealt with the more complicated subjects of the ‘revolutionary dictatorship of the proletariat’ and labour-time vouchers, both of which have been misunderstood by supporters and opponents alike.

He did not criticise the division of the programme in maximum and minimum sections (in fact he proposed some clarifications to the latter). The main demand of the new party was ‘the establishment of producers co-operative societies with state aid under the democratic control of the toiling people’. Marx’s criticism of this proposal (still in circulation today) was that ‘the workers desire to establish conditions for co-operative production on a social scale’ had ‘nothing in common with the foundation of co-operative societies with state aid.’

One point to note is that while the programme referred to ‘socialist society’ Marx referred to ‘communist society’, further evidence that for him the two terms were interchangeable.

In September civil servants and other public sector workers in Belgium carried out a nation-wide strike, lasting for over a week, against the government's proposals in its draft budget for 1984 to economise on its spending at the expense of their wages and pensions.

The strike started on Friday 9 September, after a section of the railwaymen heard the details of the government's proposals from their union officials. Against the advice of their officials, they immediately stopped work. The strike, still at this stage unofficial, quickly spread to the rest of the railway network. The unions then decided to follow the movement and declare the strike official from the following Monday. On the Monday some other public employees unofficially joined the striking railwaymen, leading to the unions calling an official general strike of all public sector workers as from Thursday 15 September.

The strength of this strike lay in its essentially spontaneous nature. It was not something that had been planned and called by the union bureaucracies, but arose from a general feeling that, in view of the cuts in living standards workers have suffered in recent years, enough was enough. The present government — a coalition of Christian Democrats and Liberals that emerged from the general election held in November 1981 — had assumed, soon after entering office, “special powers" to deal with the economic situation, which meant that it could rule by decree rather than by act of parliament. These powers had been used to end the automatic indexing of wages and salaries to rises in the cost of living, to increase social insurance contributions and to reduce benefits. It was the fall in living standards resulting from these measures that made the public sector workers so determined to resist any further cuts.

Trade unions in Belgium organise workers on the basis of their political opinion. This, of course, is absurd and has led to workers being divided into three more or less rival union federations: the Christian Democrats (SC. 1.3 million members). The “Socialists” (FGTB. 1.13 million members) and the Liberals (CGLSB. 210,000 members). But on this occasion the strength of feeling among ordinary union members was such that the rival unions had to act together in a “common front". This, together with the fact that the strike took place in Flanders as well as in the traditionally more militant Wallonia, greatly strengthened the bargaining position of the strikers.

At first the government was somewhat bewildered by the strike, the Minister of Communications declaring: “I have absolutely no idea why there is this strike; there was no warning, no notice, no presentation of demands. It is a rather amazing action" (Le Soir, 14 September 1983). The government soon realised however that the strength of feeling of the ordinary strikers was deep-rooted and that, in proposing its attack on increments, bonuses and pensions of public employees — the section of the working class best able to resist downward pressures in a crisis because their work still needs to be done whatever the economic situation — they had perhaps gone too far. In the background too was the fear that the strike might spread to the private sector, resulting in a general strike as happened in 1960-1 (also sparked off by workers in the public sector reacting against a proposal to reduce their pensions). So instead of refusing to negotiate “under duress", as governments often do in those circumstances, the government agreed to start negotiations straight away as from the Friday, indicating that they were prepared to make concessions. The Civil Service Minister spoke of a “misunderstanding" as to the government's intentions.

An agreement was reached on 21 September. The government guaranteed that the increments, bonuses and pensions due to public sector workers would remain unchanged at least until the end of 1985; salaries would however be paid at the end instead of at the beginning of the month. The Christian Democrat and Liberal unions accepted straight away and the FGTB on Friday evening after consulting its members.

A number of lessons can be drawn from this strike. First, any strike against a government decision inevitably has political undertones. The unions managed to avoid this by concentrating on the decision as it affected the wages and conditions of their members rather than on challenging (other than verbally) the government's general policy of spending cuts. Having obtained a relatively satisfactory result on the bread-and-butter issue, they wisely called off the strike. Otherwise they would have provided the government with a stick to beat them — that the strike was politically aimed at a change of government which, in the Belgian context, would only have meant a change of coalition partners. The Belgian PS, in opposition since 1981 and forgetting its role in helping to impose austerity when it did share power, did, in fact, try to exploit the strike for its own party political ends. The leader of its French-speaking wing declared that “the government must go" and clearly hinted that his party was ready to enter the government again. Fortunately neither the trade union leaders, nor even less the strikers. took any notice of this. If they had. the result would have been disastrous. If the strike had become political in the sense of demanding a change of government, it would have broken ranks, the resulting division among the workers would have strengthened the government’s bargaining position. In any event, the participation or non-participation of the PS in the governing coalition is of the utmost indifference from a working class point of view since, whatever party or parties are in power, capitalism can only function against working class interests.

Second, like the majority of strikes, it was entirely defensive, a reaction against an action taken by the employer — in this case the government. In the event the government employer was forced to withdraw' the main proposals, but the workers still had to make some concessions, which meant that their conditions of employment had deteriorated even if by a great deal less than their employer had originally intended. In other words, the strike only slowed a downward movement. This, of course, is necessary and was worth fighting for, but shows up the limitations of trade union action. The workers are always on the receiving end under capitalism, however militant they are.

Many explanations and solutions arc offered for the growing problem of homelessness. The traditional hostels and spikes echo the workhouse approach for the vagabond and the tramp — and these hostels do indeed accommodate the largest number of people. Many are run by religious organisations who see godlessness as the cause of the problem. A more contemporary approach seeks to go further in understanding and to put the matter in a social perspective. Alcoholism, family trouble. psychiatric difficulties, drug addiction — all these are cited as causes of homelessness. Many campaigning bodies such as CHAR (Campaign for the Homeless and Rootless) and Shelter put a lot of effort and resources into bringing attention to bad housing and into trying to achieve statutory responsibility.

All such approaches, however, ignore the fundamental cause of the problem of bad housing and homelessness. Why should it be a problem to have no home; to be, as the police put it. Of No Fixed Abode? In this society of private ownership of the means of life, having one’s own patch represents security and respectability. If someone does not have access to a home of their own they are homeless. Having a home and being homeless take on meaning only in a property society. A member of the working class who does not have a home can leaf through the property pages of the “quality" newspapers and see plenty of large comfortable houses available — to those who have the considerable amounts of money needed to rent or buy them. This member of the working class isn’t suffering from homelessness but from poverty — the condition of the entire class. Homelessness is a condition which does not face a member of the capitalist class.

Homelessness as a social problem docs not exist in isolation. This same property system causes hunger, war. crime — a list of misery as endless as is the number of people and groups who wrongly isolate each problem and seek a solution to it separately within the present system. They are trying the impossible. Only in a socialist society, a society without private property, will such problems be abolished.

Our old comrade Matt Bragg died early in October. He joined the SPGB in June 1923, transferred to Southend Branch about eight years ago and in that time was a regular attender of Branch and other meetings. His consistent work for the Party and determination to promote the case for socialism remained with him to the end. His last days were spent in hospital, still putting the socialist case in discussions with his fellow patients, the Socialist Standard on display at his bedside. At rising 85 years of age. Matt never gave up. Although failing in mobility, he was last seen in London supporting election activity, as he had done in his own area of Southend. He was Branch treasurer for some years until January this year and wrote letters to the press. His congenial and predictable personality were a source of strength to us all and will be sadly missed. We extend our sympathies and understanding to his sister and all relatives.